Myanmar: Withholding tax update for large taxpayers

Myanmar: Withholding tax update for large taxpayers

The “large taxpayer office” of Myanmar’s tax authority on 28 November 2016 launched a newsletter in order to provide updates on Myanmar-related tax matters. In this first newsletter, the large taxpayer office clarified a few points with a special focus on withholding taxes and their application in Myanmar.

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In earlier withholding tax guidance, the term “buying goods” was replaced with “buying goods within the country” but there was no similar provision with respect to services. In the November 2016 newsletter, it was clarified that the failure to include services within this definition was a clerical error, and that withholding taxes would be applicable to “services within the country.” Thus, withholding taxes in relation to services would only be applicable to services purchased within Myanmar.

While the newsletter does not clearly state a de minimis threshold for withholding tax at MMK300,000, the newsletter does state that the tax authorities are reviewing taxpayer compliance relating to declarations of withholding tax on purchases of goods and services having a value in excess of MMK300,000. Also, the newsletter reminds taxpayers of their obligations to undertake withholding—irrespective of a supplier’s willingness to accept withholding tax.

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